Business Insider, by Leanna Garfield, 23 Jan 2018
- The vertical farming startup Plenty just announced that it plans to build 300 organic, indoor farms in or near Chinese cities.
- In late 2017, the company scored $200 million in the largest-ever ag-tech deal. The funding round was led by Softbank Ventures and included DCM Ventures as well as funds that invest on behalf of Alphabet’s Eric Schmidt and Amazon’s Jeff Bezos.
- Due to rising concerns surrounding food safety, middle-class Chinese consumers are increasingly willing to pay a premium for organic produce.
In the past two decades, China has experienced several food scandals. Between 2001 and 2006, toxic mushrooms killed 148 people and poisoned over 500 others in Yunnan. In 2010, Hunan police shut down a large operation that produced “green beans” from dyed soybeans.
A Jeff Bezos-backed indoor farming company called Plenty will soon harvest some of this organic produce. But unlike traditional farms, it will grow crops on LED-lit 20-foot-tall towers, which do not require soil, pesticides, or even natural sunlight. The technique is called vertical farming.
Plenty says it will build 300 vertical farms in or near major Chinese cities, where it will capitalize on the country’s growing middle-class demand for organic produce. The first farm will open next year, Bloomberg reports. In Beijing and Shanghai, the company will also build centers where customers can taste produce.
(Bloomberg) — Vertical farming startup Plenty Inc. plans to build 300 indoor farms in or near major Chinese cities to meet rising demand from the country’s middle-class who are willing to pay more for safer food.
The company also plans to set up what it calls experience centers in Beijing and Shanghai so that local residents can taste raw vegetables, Chief Executive Officer Matt Barnard said in Beijing Wednesday. The first farm will be built in about a year.
Eating raw vegetables isn’t popular in China, partly due to safety concerns. Families generally fry or boil vegetables to mitigate the impact of any residues from pesticides and chemical fertilizers, according to Barnard. China will speed up production of high-quality and “greener” farm products as it focuses on quality over quantity, agriculture minister Han Changfu said Tuesday.
The vertical indoor farms will help in saving more water and soil and produce higher yields than traditional farms, said Barnard. The farms would help the world’s most-populous country meet challenges such as shrinking water and land resources, he added. In July, SoftBank Group Corp’s Vision Fund led a $200 million investment in the Silicon Valley startup.
To date, the Silicon Valley startup has raised $226 million. In July, $200 million came from a Series B funding round led by SoftBank Vision in the largest ever ag-tech deal. The round included DCM Ventures as well as funds that invest on behalf of Alphabet’s Eric Schmidt and Amazon’s Jeff Bezos. In a past interview with Business Insider, Plenty CEO Matt Barnard said the company hopes to eventually sell its organic produce for the same price as traditional produce. Plenty plans to drive down operational costs by automating its growing processes as much as possible.
In the spring, Plenty will open a 100,000-square-foot farm in the greater Seattle, Washington area. The 100,000-square-foot warehouse facility will grow 4.5 million pounds of greens annually, which is enough to feed around 183,600 Americans, according to the USDA. The company also has a smaller non-production facility in Wyoming, where it has tested different growing processes for over 300 crops.